New “Real” Living Wage for 2017
The “real” Living Wage for 2017 has been announced. The rate for UK workers has increased to £8.45 per hour, with the London Living Wage rising to £9.75 per hour.
The “real” Living Wage is independently calculated each year by the Living Wage Foundation. Unlike the UK Government’s mandatory National Living Wage, the “real” Living Wage is voluntary.
Voluntary Living Wage VS Mandatory Living Wage
Ever since the Government introduced their own version of the “living wage” in April 2016, it has caused a bit of confusion. This is because there are now two different “living wages”!
The key difference, is that the National Living Wage (NLW) is based on mandatory rules set by the UK Government, whereas the “real” Living Wage is a set of voluntary guidelines, managed by an independent body.
According to CIPD, the “real” Living Wage is now 17% higher than the Government’s National Living Wage. But which rates should you be applying?
If you are only interested in meeting the minimum legal requirements, then the National Living Wage is what you should be looking at. However, nearly 3,000 employers have now pledged to meet the guidelines set by the Living Wage Foundation.
One such company is Ikea. According to Pernille Hagild, Ikea’s HR manager in the UK, the company has seen lots of big business benefits since starting to pay the “real” Living Wage. These benefits include:
-Lower staff turnover rate
-Lower employee absence levels
-Better quality of job applicants
Are you ready for the new Living Wage 2017 rates? Do you already pay the “real” Living Wage? If not, why not? And is it something you’re considering?
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